The Register-Herald, Beckley, West Virginia

Wyoming Report

January 28, 2010

Residents will notice funding cuts, official says

Wyoming County could lose a third of its tax funding if the industrial and commercial personal property taxes for businesses are eliminated.

That loss will translate into cuts in county classrooms, as well as municipal and county services.

Those cuts will be readily noticed by county residents, according to county Clerk Mike Goode.

Gov. Joe Manchin wants to change the constitutional amendment, giving the state Legislature authority to exempt personal property used in industrial and commercial businesses. His intention, he said in his State of the State address, is to improve the business climate in West Virginia.

“The assumption is that if businesses didn’t have to pay a tax on their personal property, they would be in a relatively stronger position,” noted county Circuit Clerk David “Bugs” Stover, who also serves as president of the West Virginia Association of Counties.

“New businesses would come to West Virginia and old ones would do better.

“This is possible, but anyone living in a county like Wyoming, where more than 80 percent of all the land is owned by a few land corporations, can tell you that paying a much lower rate of taxes on their property than us citizens does not necessarily mean they will pass it on as development. They don’t. They should!

“If we assume that companies would flock in and build here, we must then look at others things,” Stover said. “How does one make up the difference? Will growth bring more jobs and a larger tax base that will somehow get back to fund counties and county schools? If not, who will pay the tax increase in other areas to make up the shortfall?

“When it was first raised, this suggestion by Gov. Manchin, would be a major impact on counties,” Stover said. “If the money were not made up, it would bankrupt several counties and school systems.

“The commission that studied this recognized that it would devastate counties and said that counties would remain blameless,” Stover noted. “This means that whatever money was taken from counties would be made up.

“It was never really stated how it would be made up.

“We need to take a close look at this.”

Stover noted the proposal is still being discussed and changed at the state level.

“Would the legislature actually do this — if given the power?” Stover asked. “They will be the ones trying to figure out how to make up hundreds of millions of dollars.

“Politically, they will be under tremendous pressure from companies on one side and counties, schools, and citizens on the other. I hope they have really strong backbones.

“I am reminded of the companies who wanted in on drilling for coalbed methane,” Stover said. “They suggested that they need a two-year stay on paying a severance tax to the state and back to counties where produced.

“One could argue that was reasonable. Of course, if most of what you plan on doing is to be done in the first two years, then one might more accurately call it clever of them — but reasonable? Not to counties and citizens.

“This will be fun to watch as it moves and changes its way through the legislature,” Stover emphasized.

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